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There are two different discussions going on right now on the ABMP and Massage Mag LinkedIn groups regarding Groupon. If you don’t know what Groupon is, check it out at www.groupon.com.

I’m not here to advocate the use of Groupon or steer you away from it.  I just know that services like this are being used by therapist with varying results. Therefore, I felt it important to open up the discussion so we can all learn more about this promotional concept from those that have used it.

Allow me to weigh in first with some input based on my observations of some of the experiences our clients and prospective clients are having:

A)     “My phone is ringing off the hook!” (This is what we are hearing from prospective clients calling looking for a solution to deal with their crazy call volume).

It seems that the response you can get from running a Groupon promotion can be very high (200 to 1200 Groupons sold in a day). Which means: That once your Groupon (coupon) is posted you can expect a flood of calls coming in. Not being prepared to absorb the increased call volume can create a problem.

B)      “All I am doing is discounted appointments!”

The other issue that I see happening is if you do not limit the times when someone can us their Groupon, you can end up giving $18 one hour massage (a $60 massage offered at $30 and then the 40% Groupon fee taken out) until  you fade off into the sunset.

Offering the ability to allow clients to schedule online and then having the criteria that all Groupons must be scheduled by the client online, can resolve ‘A’. Limiting their ability to only schedule on certain times on certain days can resolve ‘B’. We have a client that only allows two appointments per shift for 9 out of his 16 therapists to be scheduled with a Groupon. The calendars for these 9 therapists have Groupon appointments booked almost to the end of the year.

That's all I know. So please share your Groupon experience if you have one. Hopefully the folks on LinkedIn that have shared their experiences there will jump in here.

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Hi Gang,

You can do similar yield management with your schedule simply by charging more for your prime time slots, and funneling Groupon or other deal buyers into the slow times you want filled.

 

I've always said we as an industry need to change the paradigm of how we package and sell our services, the problem is that most therapists and massage instructors are not business-minded so these new-thinking concepts are lost on them.

 

ABMP asked me to write an article for their Massage and Bodywork magazine regarding massage therapist's use of deal sites. It will be published in the Jan/Feb issue (keep an eye out for it, even though it is a ways away :) I think it will be helpful and enlightening for many.

 


I hope you said all the bad things too about Groupon and groupon-alike sites!

 


Irene Diamond, RT said:

Hi Gang,

You can do similar yield management with your schedule simply by charging more for your prime time slots, and funneling Groupon or other deal buyers into the slow times you want filled.

 

I've always said we as an industry need to change the paradigm of how we package and sell our services, the problem is that most therapists and massage instructors are not business-minded so these new-thinking concepts are lost on them.

 

ABMP asked me to write an article for their Massage and Bodywork magazine regarding massage therapist's use of deal sites. It will be published in the Jan/Feb issue (keep an eye out for it, even though it is a ways away :) I think it will be helpful and enlightening for many.

 

Angela,

I don't think Groupon or the other deal-sites, are inherently bad- BUT...

therapists need to know exactly how to do them. If it's done right- it can be very worthwhile for some quick revenue generation and client acquisition, again, though the deal site has to be picked for the therapist's brand and the structure has  to be negotiated correctly.

Then I don't think that will be an impartial and complete article about it. 

So far, I liked what Bob Phibbs has said about Groupon


Irene Diamond, RT said:

Angela,

I don't think Groupon or the other deal-sites, are inherently bad- BUT...

therapists need to know exactly how to do them. If it's done right- it can be very worthwhile for some quick revenue generation and client acquisition, again, though the deal site has to be picked for the therapist's brand and the structure has  to be negotiated correctly.

I did not post any asterisks -- the word I typed was CHINK....but I think I am a victim of the PC police which edited my word for me.

 

Reminds me of when Newspapers went PC and changed their spell checks. Lots of business stories had some embarassing substitutions, especially when focusing on improved business results. Several stories at the Philly Inquirer stated how the business was "back in the African American". Boy, were they Native American Faced over that!

But anyhow...

 

Text messaging your own deal for yield management is one method, but it only reaches current customers.

The main alleged value of the deal sites is in bringing in new customers.

 

i think deal sites ARE inherently bad for several reasons -- and not just in our industry

#1 -- the economics are poor for the merchant, especially if they are not a sole practitioner, Downright money losers in most cases.

#2 -- send a bad message to the buying public. Too many are too accustomed to jumpin from one deal to the other and works against customer loyalty (sure, they loved your massage, but not at that price). There are plenty of discount massage places and facial too. If you can't afford it, go somewhere you can afford.

#3  - customer acquisition costs turn out to be very high, when you figure the % of people that actually repeat vs. the number of services you did not have to lose money or on discount so highly (same problem with SpaWeek -- your regulars rush in to get the $50 treatments and skip the full price service they would have done +/- the 7 days around Spa Week)

 

#4 - Not many are interested in their merchant partners. The deal site makes money on all the deals, even if the merchant does not. They are not partners, they are parasites, willing to kill their host and move on to the next.  Merchants can exists without deal sites, but deal sites CAN'T exist without merchants. ABout time they started acting like it.

The site automatically blocks some words on a watchlist that are considered to be derogatory in nature. "Chink" has had some negative connotations in the past, but in your post it's obvious as to your intended use. I removed it from the list so it won't show as asterisks anymore.

 

Best,

Abram Herman

Site Moderator at massageprofessionals.com

Relax & Rejuvenate said:

I did not post any asterisks -- the word I typed was CHINK....but I think I am a victim of the PC police which edited my word for me.

 

I agree, groupon-alike sites are bad in my opinion.

The text messaging is not only for current customers, it attracts new customers because new people will be interested in subscribing to get specials. That's a good way to attract new customers. The problem with text messaging is that you still have to do the advertising for this text message campaign. 

Your yield management method sounds really good to me, as long as it has great exposure, the same as groupon or massage envy do. What is the name of that company again? is it expanding? when is going to be covering South Florida?


Relax & Rejuvenate said:

I did not post any asterisks -- the word I typed was CHINK....but I think I am a victim of the PC police which edited my word for me.

 

Reminds me of when Newspapers went PC and changed their spell checks. Lots of business stories had some embarassing substitutions, especially when focusing on improved business results. Several stories at the Philly Inquirer stated how the business was "back in the African American". Boy, were they Native American Faced over that!

But anyhow...

 

Text messaging your own deal for yield management is one method, but it only reaches current customers.

The main alleged value of the deal sites is in bringing in new customers.

 

i think deal sites ARE inherently bad for several reasons -- and not just in our industry

#1 -- the economics are poor for the merchant, especially if they are not a sole practitioner, Downright money losers in most cases.

#2 -- send a bad message to the buying public. Too many are too accustomed to jumpin from one deal to the other and works against customer loyalty (sure, they loved your massage, but not at that price). There are plenty of discount massage places and facial too. If you can't afford it, go somewhere you can afford.

#3  - customer acquisition costs turn out to be very high, when you figure the % of people that actually repeat vs. the number of services you did not have to lose money or on discount so highly (same problem with SpaWeek -- your regulars rush in to get the $50 treatments and skip the full price service they would have done +/- the 7 days around Spa Week)

 

#4 - Not many are interested in their merchant partners. The deal site makes money on all the deals, even if the merchant does not. They are not partners, they are parasites, willing to kill their host and move on to the next.  Merchants can exists without deal sites, but deal sites CAN'T exist without merchants. ABout time they started acting like it.

Recently all i have had is groupon clients . Its utterly frustrating doing one hour massages for 8$ or 90 mins for 12$. im my expeirence they are only out for a discounted massage and hardly ever become regular . i feel as if im being taken advatage of , its a slap in the face .  

Sorry you are having a bad experience, but only you can let yourself be taken advantage of by signing up for such a program.

GROUPON does seem to have gotten the message from disgruntled merchants. They are now only taking a 25% -- or sometimes a little less -- on the deal amount, which allows us to make money, so we gave it a try with them.

The experience has been surprisingly positive. Clients AREN'T picking the most expensive treatment on the menu because if offers them the greatest savings (as we saw with Travelzoo customers) and several have purchased products.

groupon also pays very quickly and only 1/3 of the sales have been redeemed nearly a month into it.

I am still not a big fan, but it helps cover some fixed employee costs so I am paying them to do massages instead of paying them to do nothing.

Hi Kathryn...I know you posted this in November..and at that time I was working at a Salon that just started Groupons...well now its April and they are still doing $41.00 60 minute Massage...I have to split the salon cost of $21.00 with the owner - which leaves me $10.50/massage....clients "love the massage"...but they do not come back!  $70 massages for $10.50!  People just don't realize (nor does the  owner of the salon) what actually a massage therapist does and what the real benefits are...I am very FRUSTRATED!!



kathryn marie littlejohn said:

Recently all i have had is groupon clients . Its utterly frustrating doing one hour massages for 8$ or 90 mins for 12$. im my expeirence they are only out for a discounted massage and hardly ever become regular . i feel as if im being taken advatage of , its a slap in the face .  

I have experience with buying and selling Groupons.  Our mini day spa sold 1000 coupons and we were swamped for almost a year, right up until the expiration date.  We were meticulous about managing the influx of new business and managing our regular clients so that both groups received a high level of service.  This is one of the main complaints with small businesses selling a Groupon.  They get overwhelmed with volume and their customer service severely suffers.  Then ruthless new customers start leaving bad Yelp reviews or other internet reviews and it ultimately hurts the business.  I collected a handful of regular clients from our Groupon experience.  While our experience was somewhat positive, we would never sell another one.

Recently, I decided to purchase a massage Groupon from another small day spa.  I knew it would probably be difficult to make an appointment and indeed it was.  But my expectations were managed from my previous experiences so it wasn't upsetting to me.  I simply waited until I heard back (it took leaving a few voicemails over the course of a couple weeks), made my appointment and had my massage.  It turned out to be one of the best massages I've had and now I'm a regular client of that massage therapist. 

I know of another small day spa that releases 50 coupons every quarter so that the business gets a boost but is completely manageable.  It seems to work well for them. 

there are so many ways to handle these daily deals- as long as you are strategic in what it is and how you position your offer,  it is thought out in advance and planned for, there should be only an 'up-side' where you make some money, get new clients, and turn them in to 'regulars' who want to come back and see you!

I advise businesses to look at it as an opportunity to promote your business where you are only asked to pay AFTER you make the sale. (Remember, traditional advertizing costs you money no mater if you don't even sell one service!)

And bottom line, those deal companies need us way more than we need them, so be ruthless in your negotiating!

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